Home improvement

You could say 2009 has been a good year for B&Q. Not only has UK retailer seen its profits double in the past 12 months to £58 million, it has also successfully launched a new corporate gift card and an internal recognition scheme for all of its employees.

And with the corporate gift card reaching sales of £500,000 within just three weeks of its launch, it seems it couldn’t have come at a better time, despite the overall economic gloom.

Arun Glendinning, the man behind the venture, says the skyrocketing sales are a sign that there was a gap in the market waiting to be filled. So far, the card has been adopted by the likes of P&MM and Jordan Media as part of their reward portfolios, with other incentives and rewards specialists coming on board all the time.

“We believe there is significant demand in the incentives market for our gift card offer and will be retaining exclusivity of our brand in this area,” says Glendinning, who is B&Q’s business services manager. “Our gift card is perfect for every type of scheme from rewarding staff for achievement, improved performance, or reduced absenteeism; boosting sales direct to the consumer via third party channels; through to encouraging product trial uptake. The potential applications are endless.”

And Glendinning should know. Having joined B&Q as a teenager in Glasgow, he worked his way up through the business over 15 years to end up a qualified project manager with a knowledge of the company – and its challenges and opportunities – that is second to none.

His various roles throughout the years included employee training, implementing chip and pin, improving functionalities for promotions, overseeing the store rollout programme, and finally, launching both the retail and corporate gift cards in the last two years.

Glendinning says he first looked at gift cards in 2006, at a time when the concept had well and truly taken off in the United States, but was only beginning to be adopted here.

“The likes of Asda had already come out with a gift a card, so there was a lot of eagerness and anticipation surrounding their launch in the UK,” he says.

B&Q’s retail gift card went live in 2007, at which point Glendinning had the option to move to another project or stay where he was and develop the gift card offering.

He decided to stay, and the rest, as they say, is history.

“2008 was about maximising as much potential as we could from the retail gift card scheme by doing things like promotions, going into third-party distribution, and of course all the planning for Christmas.

“In 2009, the role has become a lot bigger, and we began looking at everything that could come under a single brand. So the website is launched, the brochure is put up there, we’ve aligned marketing collateral and we’ve streamlined contacts.”

What Glendinning is referring to is the creation of B&Q Business Services, which aims to unite B&Q’s various corporate offerings under one roof. In addition to operating the corporate gift card scheme, Business Services’ main function is to provide dedicated support for corporate customers, including account management, creative solutions such as design and copywriting, fulfilment and distribution, redemption tracking reports, and 24 hour delivery from receipt of order.

“It was about putting a united front and brand – B&Q – into existing services that we had, and bringing them all under one umbrella,” he says. “Now that [the corporate gift card and B&Q Business Services] are embedded, we’re looking at which new services we can offer, like insurance replacement, for example.”

In the meantime, however, B&Q is also tracking its new Thank You scheme, which was launched in March of this year and is the first application of the new gift card. Glendinning says it has been gaining momentum, with more and more requests for the card coming in, “especially now, when people are doing a lot around the house and garden”.

The online-based recognition scheme encompasses all of the retailer’s 34,000 UK staff and allows any employee to send an electronic ‘thank you’ to another via an in-store or department computer terminal.

Store staff can be thanked for achieving in four key areas: customer, availability, product, and presentation, and store support office colleagues can be additionally rewarded for delivering a great service. Any colleague in any function can thank another; so the scheme is not restricted to a thank you from a manager.

At the end of each month, HR and store managers select one or more outstanding individuals from all those who have received an electronic ‘thank you’, and these individuals are then awarded a B&Q gift card.

The value loaded on the card at the time of the award is decided by the store manager or HR manager. The gift card is presented in a carrier that can be personalised with a hand-written message, and the carrier can also be assembled into a desk-top standing memento that acts as a permanent reminder to the recipient.

“The extra touches we do around the scheme, like the card and the presentation, have made it popular,” says Glendinning. “But you have to refresh these things and keep them interesting.”

The scheme replaces an earlier one provided by Capital Incentives, but offers B&Q’s own products as rewards as opposed to external gifts.

Says Glendinning: “People enjoyed using the rewards from Capital Incentives, but we thought given there’s X million people walking through our stores everyday and buying our products, why aren’t we rewarding our own people with our products?

“There was a feeling that as B&Q shifted into offering more stylish and aspirational lighting fixtures, cushions, and paints, it would be a suitable reward mechanism.”

One of the best things about the Thank You scheme is that it’s not prescriptive, so it allows managers to use their discretion and choose an alternative reward if a DIY product isn’t suitable. For example, if a staff member doesn’t own a home and is more likely to appreciate chocolates than a pot of paint, the manager has the option to offer something different, although the preferred reward is the gift card.

For those employees who do receive the gift card, they have the added bonus of using their 20% staff discount on whatever they choose to purchase.

So how does Glendinning see the gift card developing, given the current tightening of budgets for reward programmes?

“It’s been a good time for us to launch,” he says. “If you look at reward and recognition programmes, a lot of them are there to replace commission, given the current economic conditions, so having B&Q as an option for those companies and providers is good.”